Book of the week: An attack on market-friendly reforms

published 11 August 2017

Divide:A Brief Guide to Global Inequality and its Solutions

Most development economists agree that market-friendly reforms have rescued poor countries from poverty. Growth in developing countries has been so rapid that critics of globalisation now tend to focus on the negative effects on workers in developed countries. Jason Hickel thinks this jubilation is premature. He argues that poverty is increasing, that economic growth in developing countries was faster during periods of state intervention, and that market reforms are reducing growth.

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Hickel highlights some genuine problems, but these are lost within a blizzard of cherry-picked examples, creative interpretations of statistics and a one-sided approach to economic history that sees developing countries as helpless victims of Britain and the US. Indeed, the book goes so far as to absolve developing countries of any responsibility for their misfortunes.

Corruption is only discussed in terms of firms evading taxes (a problem that actually ends up disadvantaging developed countries more than emerging markets). Nor do you learn that a century of protectionism and state-directed development took countries like Argentina from one of the richest places in the world, to a middle-income country. This is certainly a provocative book, but its central argument is unconvincing.